Liverpool FC Forum

[hello_red]

If a picture spoke a thousand words even Sammy Lee's buzzin off Parry.

When was that taken?

[Reg]

Read this thru anjd tell me where Hicks is confused by Rafa´s numbers:

A-Rod's dollars make sense for Yankees

By Vince Gennaro, Special to Yahoo! Sports
November 27, 2007

 
Despite the posturing, bruised egos and serpentine route of the courtship, Alex Rodriguez and the New York Yankees are a money-making marriage unparalleled in professional sports.

We know the details of Rodriguez's contract: $275 million for 10 years, plus another $30 million if he breaks Barry Bonds' all-time home run record, structured in a marketing arrangement to get around major league baseball's restrictions on statistics-based incentives.

It is the largest deal in professional sports history, and both A-Rod and the Yankees stand to get significantly richer because of it.

Combining Rodriguez's value over the life of the contract and considering the economic effect of the new Yankee Stadium set to open in 2009, he is likely to generate approximately $450-million of "value" for the Yankees, according to my analysis of his impact. Assuming the Yankees exceed the luxury-tax threshold in each of the 10 years and trigger the 40 percent luxury tax, the total cost for Rodriguez will come to $427 million.

The true economic value of A-Rod is based on the Yankees' revenue growth and asset appreciation that we can attribute to him. Economists call this a player’s marginal revenue product, but I’ve expanded it beyond revenue to include the marginal value of the Yankees' assets – their ownership stake in the YES Network and the value of the franchise.

Rodriguez has two sources of value: performance and marquee. Performance value is determined by the impact of his playing performance on the Yankees' win total and the resulting financial gains from the team being more successful because of his contribution We derive marquee value from A-Rod’s persona, image and even the more tangible value of drawing fans to watch him chase future personal milestones.

By adding his performance and marquee values for each year, we can assess the full 10-year value of A-Rod to the Yankees and prove why the $275 million salary with the potential for $30 million more in incentives negotiated by Rodriguez made a lot more sense than the $350 million his agent, Scott Boras, originally postulated.

PERFORMANCE VALUE

When the Yankees make the playoffs, which they've done 12 consecutive seasons, it's worth nearly $40 million. A World Series victory is worth $70 million, calculations that I explained in my previous story for Yahoo! Sports, World Series financial scoreboard. Winning in New York draws more money than anywhere else, so it's no surprise the Yankees have carried baseball's biggest payroll eight consecutive seasons and 11 out of 12.

Revenues respond to winning, and by combining statistical tools, including regression analysis, with attendance, ticket pricing and a host of other financial data, we can estimate the change in revenues that corresponds to each level of regular-season wins. I detail this concept, the win-curve, for each MLB team in my book, "Diamond Dollars: The Economics of Winning in Baseball."

Each team's win-curve is as unique as a fingerprint, incorporating the size of the market, loyalty and expectations of the local fan base, plus the depth and breadth of a team's revenue streams. Teams that own a stake in a regional sports network (RSN), such as the Yankees, Red Sox and Mets, have a leg up on their competition when it comes to generating value from winning. Through their ownership stake, they directly benefit from increased ad revenues and the appreciation in the value of the network that can result from being the flagship broadcast partner of a winning sports franchise.

And nothing defines winning like postseason success. Teams often see dramatic jumps in season tickets, merchandise sales and broadcast ratings in the year following a playoff run. As a result, the player (or group of players) that boosts teams into the playoffs, or at least keeps them there – the last piece of the puzzle – can create significant financial value.

The perfect storm of player value comes when a player in a large market joins a team with highly developed revenue streams and makes the difference between reaching the postseason or spending October at home. A-Rod and the Yankees potentially fit this description as well as any player-team combination in baseball today.

In order to fairly assess A-Rod's value, there are some quirks to account for in the Yankees' win-curve. The normally demanding Yankee fans may soon take a temporary break from their fixation on winning. With the last season at historic Yankee Stadium and the opening of an amenity-filled new version in '09, the Yankees should have near capacity crowds regardless of their wins and losses in 2008 and 2009.

The stadium trance has serious implications on A-Rod's value. One key component of the Yankees’ revenue equation – attendance – will only be modestly affected by players' on-field contributions, at least in the short term.


Eventually, though, the financial stakes of winning will spike. The highest ticket prices in baseball. An abundance of only-in-New York-expensive luxury suites. Expensive concessions and even more expensive merchandise. The Yankees' win-curve will become a steep, slippery slope.

Win and rake in the cash.

Lose and beg for a tourniquet to stop the financial hemorrhaging.

Figure 1 shows two versions of the Yankees win-curve – the 2007 version in the current Yankee Stadium and the eventual post-grand opening version in the new Yankee Stadium. Additional revenue from winning doesn't typically begin until a team exceeds 70 victories.

Judging the fair value of a long-term contract can often hinge on the assumptions made about the player's performance, his rate of decline with age and his injury risk. Using conservative but realistic assumptions, over the next several years we can expect A-Rod to perform closer to his level of play in 2004, his first year as a Yankee, when he hit .290 with 35 home runs and 120 RBIs. Excellent year, no question, but nothing like his two MVP seasons in pinstripes. We’ll then assume a gradual and steady decline during the back half of his 10-year deal, ultimately finishing his career as a .270-batting, 20-homer-hitting aging superstar.


The net result is a modest dollar valuation for his on-field performance in the beginning and end of his new contract, with a dramatic, lucrative spike in the middle years, while he’s still in his prime and the new stadium effect is passé.

Figure 2 shows estimates of A-Rod’s performance value – the incremental attendance, merchandise sales, corporate sponsorship dollars, and broadcast revenues and valuation at YES, due to A-Rod’s role in making the Yankees a winning machine. It hits a low of $17-million per year early in the contract and peaks at more than $50 million per season in the middle years. Rodriguez’s cumulative performance value over the 10-year contract is estimated to be approximately $305 million in revenue and asset appreciation.


MARQUEE VALUE

Some believe that marquee value – or "iconic" value as Boras, calls it – is marketing fiction. The naysayers believe that fans root for the laundry, and as long as their team wins, fans couldn't care less about the players. After studying focus groups, researching fans and analyzing other factors, however, I'm convinced that marquee value is real – and adds to the financial value of players the caliber of Rodriguez.

Star players that are articulate, have a clean image and come off as likeable possess a value that carries over to the brand equity of the team. These players personalize the team brand and help build an enduring connection between the team and its fans that lasts long after they are gone. Though Rodriguez presents himself well, his appearance in the New York tabloids with a stripper and the perception of him as greedy for opting out of his original Yankees contract do raise questions.

My formula for measuring marquee value considers the value of the team brand and the player's personal attributes. It allots a modest one-third of the appreciation in franchise value to the mega-stars on a team.

Beyond Rodriguez's impact on franchise value is his impact on the value of the YES Network. Boras is doing his typical Pinocchio act when estimating it at $500 million or more, but it is reasonable to say the YES Network will be a more valuable asset – $50 to $100 million more over 10 years – because Rodriguez is a Yankee.

The lofty $3 billion valuation experts have placed on the YES network is largely based on the popularity and appeal of the Yankees and the resulting industry high subscriber fees paid by cable and satellite providers. Along with shortstop Derek Jeter, A-Rod is an important asset who adds star power to the network, in addition to contributing to the Yankees winning ways. The potential for celebrating his many milestones, retiring his number, wearing a Yankees cap into the Hall of Fame, and bringing the all-time home run title back to New York can be centerpieces of YES programming for years to come and earn Rodriguez credit for a small piece of the network’s projected future growth.

A more tangible component of marquee value is as a drawing card from chasing personal milestones – becoming the youngest player to 600 and 700 home runs and chasing the career record in 2013 or so. If each of the five milestones referenced in his contract – Willie Mays' 660 home runs, Babe Ruth's 714, Hank Aaron's 755, Barry Bonds' final tally and setting the all-time mark – drew an extra 60,000 fans and netted a modest $1 million in merchandise sales, they would contribute $20 million to Yankee revenues.

Fans' affinity for Rodriguez, however tepid it is now, should slowly build depending on how quickly he passes the other luminaries on his way toward Bonds. A-Rod's marquee value also should increase as Jeter and other iconic Yankees such as Mariano Rivera and Jorge Posada reach the end of their careers while his is still going strong.

Marquee value should net the Yankees about $145 million over the life of the contract, starting at about $10 million per year in the early years of the contract and peaking at over $20 million per year as he nears the record. For perspective, Jeter’s marquee value to the Yankees is about $2 million per year more than A-Rod’s. However, Jeter’s total value to the Yankees over the next 10 years is estimated to be approximately $6 million per year less than Rodriguez's value because his performance value is considerably less.

The final necessary adjustment is to provide the Yankees with a return on their investment to compensate them for the risks associated with signing a star player to a 10-year deal. Our projected revenue stream only occurs if A-Rod stays healthy, keeps out of trouble, and his skills erode at a normal pace. Any less favorable scenario means A-Rod generates less value for the Yankees but still receives his full salary. What rate of return on their investment adequately compensates the Yankees for bearing these risks?

As an alternative to spending money on A-Rod, the Yankees could put their cash in a 10-year Treasury Bond and earn a risk-free return of about 4.25 percent. The expected revenue stream from a 10-year player contract is at least as risky as a Triple-C rated junk bond, which currently yields 12.5 percent. By paying A-Rod a $275 million salary and bonus payments that could earn him $305 million, the Yankees can pay another $120 million in luxury taxes and still generate a fair return on their investment that compensates them for their risk.


Based on the timing of the cash flows – expected Yankee revenues and Rodriguez’s compensation – the investment yields a positive net present value for the Yankees, even using a 12.5 percent discount rate.

Figure 3 summarizes the calculation.

The total revenue and asset value of A-Rod to the Yankees is at least $100 million greater than the value he could have generated for any other team. No other team has a comparable fan base and revenue model. Combining the industry-leading YES Network with the highest priced tickets and New York-sized demand for luxury suites means no team can move the financial needle like the Yankees.

Only the Cubs, Mets, Red Sox, Dodgers and Angels might have justified a contract of this magnitude and only on the condition that they assembled a playoff-bound team without exceeding the luxury-tax threshold. Not only did A-Rod end up in the place where he could generate the most value, but the terms of the deal are a win-win for both A-Rod and the Yankees.

Despite what appeared to be a roundabout route back to New York by A-Rod, the case can be made that everything went according to script. Maybe he had to opt out to get the Yankees best offer on the table. Maybe the Yankees had to threaten to shut off negotiations after the opt-out to restore their leverage. Maybe Boras had to excuse himself from the proceedings during the delicate period when his client and the Yankees reconnected.

Yet there are no maybes when it comes to a healthy Alex Rodriguez. He will be worth every penny the Yankees pay him – and more.


Vince Gennaro is a consultant to several Major League Baseball teams and the author of "Diamond Dollars: The Economics of Winning in Baseball," an innovative look at the business of baseball. This followed a 20-year career at PepsiCo, where he was president of a billion-dollar division. Gennaro teaches a graduate course on the business of baseball in the Sports Business Management program at Manhattanville College. Send Vince a question or comment for potential use in a future column or webcast.

[bigmick]

Couple of questions Reg. Firstly, is the article about baseball. And secondly, what is the basic point? Is it just that that Maxi Rodriguez bloke is earning lots cash for hitting lots of home runs, or is there a deeper parallel to our own situation? Do Hicks and Gillet own that team?

You know me mate, post up that they're going to start rotating Rodriguez and I might get interested, all the financial stuff and Marquee value gives me brain ache.

[priv]

How Liverpool Football Club is run

Rafa chooses the team to play each match and asks Rick if he can have a new player.

Rick writes the name down, mumbles a bit and puts the phone down. He then spends the rest of the afternoon in Tie Rack with his phone switched off.

Foster's gone on holiday and thinks Rick is in charge, but as we know Rick's in Tie Rack and Rafa's wondering what's going on.

So Rafa decides to sort out transfer deals himself and lines a few up. At the back of his mind he wishes Foster was around because he was quite helpful when he went to South America and came back with Lucas.

Meanwhile, Rick has is torn between two ties and can't decide which one's best.

Rafa's now growing impatient because he wants to tie up deals and both Foster and Rick have gone awol. This is when he makes his big mistake: he rings Tom because George was out playing golf.

Rick still can't choose a tie and it's got worse. The shop's closing for the night, he refused to leave and they've threatened to call the fuzz.

Tom's in the middle of buying some players for whatever strange sport they have across the pond when Rafa rings. He's having a bad day because he's just realised the new stadium for that franchise in Limeyland is going to cost a fortune and he's trying to buy another rounders player. So he loses his rag with Rafa and tells him to focus on coaching the players he's got and that they'll sort it out in December.

Rick's now explaining to the police why he won't leave Tie Rack. And he's really put their backs up by asking them to choose between a snazzy green and purple paisley number and a really cool Snoopy one. 

Rafa tries to ring Rick and Foster, but they're both still missing. George is still playing golf. Rafa repeats Toms words repeatedly at the press conference. 

Rick is now sat in the cells with neither tie. He wastes his one phone call ringing Tie Rack to ask them to put both ties to one side so he can come in and buy them both, but as they've now closed he has to leave a message on the answerphone. 

Things are now going badly wrong. Hearing of the press conference, Tom rings Rick, Foster and George and gets no reply. Furious, he sends .tv a ranting email to issue a press statement. 

The duty sergeant comes into Rick's cell to confiscate his tie. Rick goes bananas and gets sedated by blunt instrument. 

Finally, George comes back from golf to find messages from Tom and Rafa on his answerphone. He rings Tom, who's now gone off to a sports bar to rant about Rafa, Rick, Foster and George. 

Rick's still asleep, dreaming about dancing giraffes wearing really cool ties. 

Finally, George catches up with Foster, who's been surfing in Hawaii. He tells him to get on the next plane back to Liverpool and find Rick. 

Rick's now woken up and doesn't know where he is. The walls are soft and he's wearing a tight jacket that seems to have the arms tied together. Behind his back. 

Finally, George and Tom have a chat. They try to solve the problem by issuing another press release, although Tom is still adamant that he wants Rafa's head. The press release merely makes the problems worse and pressure mounts. 

The one bit of good news concerns Rick. He's finally been found by the club and after a lot of arguing, he's taken back to his office. Someone is sent to Tie Rack to buy both ties and he invites Rafa round to his office in the evening to see which one he should wear for the Porto game. He cracks a joke about the Porto tie being vital to the club's future and Rafa storms out, vowing to win everything just to show them all. 

By now, George is trying to figure out how to get rid of Tom; Tom wants rid of Rafa; Rafa wishes he'd never seen Tom; Foster is trying to figure out how to get rid of Rick; Rafa's decided Foster's a better bet than Rick; George is just waiting till he gets to Liverpool so he can thrash Foster for going awol; and Foster, he's still looking for that wave. 

And Rick? Well, he's got two new ties, so he's happy. 

[Leonmc0708]

[essexpoolfan]

I suppose the question is, what will happen from here? Do you think it will end up having serious consequences or do you think it will all blow over in a couple of weeks. Its times like this when the teams performance can really affect the manager what with all the speculation.

[Dundalk]

I myself think that it will blow over, another big story will come along and hopefully everything can be sorted BEHIND closed doors.

[red37]

Have to say that Parry photo is a great nominee for a 'caption of the week' compo..

either that or he's let one out the bag and its stunk out the gaff!  look at sammy's face though...priceless! And sums up the idle tw*t nice.

[account deleted by request]

Liverpool owners get loans for stadium
By David Bond
Last Updated: 2:26am GMT 29/11/2007


The relationship between Liverpool manager Rafael Benitez and club owners Tom Hicks and George Gillett Jr may have soured again in recent weeks, but at least the Americans are now close to sealing a £500 million deal to refinance the club's new home and their takeover.

It is understood the club have clinched a deal with US bank Wachovia and existing backers Royal Bank of Scotland to help finance the move from Anfield to a new 61,000-seater stadium at Stanley Park.

Hicks and Gillett will use the new loans to refinance, at better interest rates, the £280 million they borrowed when they bought the club for £174 million in February.

Although the row between Benitez and the owners was over his transfer plans for the January window, Liverpool sources said the difficulty in negotiating the new financing was not linked to any restrictions on the Spaniard's transfer budget.

Hopefully G&T will be in a better mood now, and will forgive and forget the recent squabbles and move on.

[lakes10]

Have to say that Parry photo is a great nominee for a 'caption of the week' compo..

either that or he's let one out the bag and its stunk out the gaff!  look at sammy's face though...priceless! And sums up the idle tw*t nice.

       

[account deleted by request]

Rafa inteview (full)

[account deleted by request]

'Now we need to talk about what the problem was and move on'

Rafael Benítez, the Liverpool manager, has revealed that he is hoping to bring forward planned talks with the club's owners, George Gillett and Tom Hicks, about his latest transfer targets.

The American duo suggested during their recent spat with Benítez that discussions about the club's recruitment policy would have to wait until after Manchester United's Premier League visit to Anfield on December 16. However, Benítez - doubtless buoyed by Wednesday night's Champions League victory over Porto - is eager to seek an early resolution to the issue as he looks to press ahead with plans for the January transfer window.


Choosing his words carefully, Benítez said: "I would hope to speak to the owners before the Manchester United game. I don't know if that is possible but we will try. But I don't know for sure. My relationship with them was good before. Now we need to talk about what the problem was and move on."

Benítez refused to be drawn on the details of his January wish-list, but - while stopping short of a public apology for his recent verbal jousting with Gillett and Hicks - underlined his desire to seek a rapprochement by suggesting that miscommunication may have been to blame for the breakdown in his relationship with the Americans.

"Maybe my English is not that good, maybe that was the problem," Benítez added. "But it is clear we have to understand the situation and talk to each other. We must decide what is best for the future of the club, we can manage that. We will, I am sure, try to do that. I prefer only to say that as a manager you can only think about your squad. January is nearly here and next summer is close also, so you must do your job, and I was trying to do this. Maybe we should talk now and analyse the situation. But I only want to talk, it is easier to talk face to face rather than to send emails or talk by phone.

"We have talked about different issues, but we did not have the same opinion at this moment. But I am sure we will talk again, they will understand and I will also understand their ideas."

Benítez also dismissed suggestions that his handling of the situation was driven by personal factors. "I was hearing it was all about my ego," he added. "That is not true, the team is my responsibility. I can stay around and at the end of the month, just go to collect my wages, but I cannot be like that, I want to improve my team and my squad. That is what I was trying to do. But I can only repeat that I do not have any personal problems with the owners."

                  ----------------------------------------------

Sounds like Rafa's eager to get this mess sorted ASAP.

[zarababe]

My Desktop and screen saver - GREAT IMAGES on a night never to forget - PROUD TO BE A RED ! 

[zarababe]

 

From RAWK - short clip of the demo, from Spanish paper ABC

http://videos.abc.es/informaciondecontenido.php?con=3181

The match will be on LFC TV at 11.00pm  !!

[zarababe]

If a picture spoke a thousand words even Sammy Lee's buzzin off Parry.

Shame on him ... coward !!